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In Ax 2009 depreciation is not calculating as per companies act 2013. please let us know how to proceed.
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Guess you would have to elaborate on that one....
Thank you for your response, in this regard I would like to inform that as per Companies Act 1956, the depreciation rates are defined on the class of
Assets. In Companies Act 2013 not defined the rate of depreciation but defined the life of assets category wise. The depreciation will be spread for the life of asset. One more important clause is residual value of the Asset is between 0 to 5% of the cost of the asset. The depreciation should calculated after deducting the residual value from the cost of asset.
For example As per Companies Act 1956 the depreciation rate is 13.91% for Plant and Machinery as per Written Down Value Method.
Basing on this if the Asset value is Rs. 100/- the depreciation is Rs.13.91 per Annum.
For the same asset as per Companies Act 2013 the life span defined in the Act is 15 years and the residual value is 5%, then the calculation of depreciation per annum is :
Cost of the Asset Rs. 100/-
Less 5% of residual value is Rs. 5/-
The depreciation is to be calculated on (100-5) Rs. 95/-
The formula for arriving depreciation rate ( 1- original cost* percentage of residual value/written down value of the asset)^(1/remaining years of asset life)*100
According to the formula for the above case is (1-100*5%/100)^(1/15)*100 = 18.10% and the depreciation per annum is Rs. 17.195.
This should be incorporated in the Fixed Asset Module to calculate the depreciation and also depreciation to be adjusted as per new act from the old act.
Hi Srinivas,
did you manage the depreciation to be booked as you have highlighted in your explanation. i am also trying the same but could not get through. any help is much appreciated.
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